How good is your company at responding to uncertainty? When events occur or something uncontrollable happens in the world in which you do business e.g. global pandemic, financial crash, war or environmental catastrophe. Does any of this sound more familiar these days?
Ever heard the term ‘Good leaders are the ones who walk the shop floor ….. often!’ It would be impossible if all this monitoring fell upon the shoulders of one business owner or Chief Executive though. No wonder MD’s are always being told to look out for their own wellbeing! Even if an ‘Executive Oversight Team’ was formed to help your MD do this, it would still be way too burdensome a task to ensure they had collected all of the intel that they require and would know where to recall that from, for analysis in time of need or indeed if a major issue arose.
Do your decision makers routinely engage in insightful conversations about how quickly the business can react to any such event? In such stressed situations Do they have the right insights to check how the business is coping with what they are already doing, before decision makers launch in and try to change things? Your organisaton’s reputation and productivity will be depending upon how well managed these situations are. And your staff need to feel like you ‘hear them’.
Directors are legally responsible for their company’s performance and financial reporting. How they communicate with stakeholders who have a legitimate interest such as Staff, Investors, Suppliers, Insurers, Licensors, Authorities, Auditors, Regulators, and even Companies House is really important. This is why most organisations try to collect data in bite size sections. So that it can be collated and understood and they call this ‘Reporting’ or ‘Management Information’. Yes many company Directors wish to have data exactly when it’s needed for analysis. But have you ever seen Reporting done well? Have you ever been to a meeting where the Board or Executives around the room haven’t been weighed down with paper or find that they have more questions than answers because of those enormous packs that they haven’t had time to digest? Have you ever witnessed a Senior Manager enjoying a great summary or being impressed by the way that they can drill down from the highlights on the page for more detail about the issues that mean the most to them? How often do decision-making meetings create more work because of the investigations raised by queries? Does it tie up resource for weeks to uncover the detail, before actual business decisions can really begin to take shape? Do the results come in time?
How likely is it that the Executives in these meeting rooms are going to take on accountability for the issues they need to resolve when there is so much inconsistency across committees and functions that it is hard to see who is ultimately responsible for what?
All the things listed below, require a delicate balancing act and good oversight mechanisms that are as natural to your organisation as monitoring the dashboard and road signs you survey on your daily your drive to work:
- Could your organisation be compromising its own governance structure (which, incidentally was created from the values and commitments it made to its stakeholders) because of poor planning or lack of management information?
- Real time performance stats. Do you even get updates on performance?
- Are you delivering performance regardless of unexpected or last minute uncertainties (risk)? Has that materialised in cost lately?
Decision makers need to know:
- How much uncertainty (risk) is your organisation already taking on?
- The information Managers are basing their decisions on
- Is your business measuring the right things to thrive and delight stakeholders?
So, here’s the secret.
The people who really know which rules are being broken or ‘tweaked’ (Governance), to get the job done are the same people who are being driven to work harder, smarter and faster (Performance). These are the same people who know how much your materials and resources are these days (Cost). They are also keenly aware of how realistic and timely your business objectives are, in light of the uncertainty (Risk) that is building up in the world in which you operate, because they are your frontline workers engaging on a daily basis with the world. They are your foot soldiers and first line of defence!
The best quality reporting we have ever seen is where the first line are trained and empowered with effective tools to identify, record, monitor, evaluate, manage and report risks to their personal performance, wellbeing and functional processes. Combine this with a company wide consistent language too and you start to have truly effective reporting.
When everybody in the first line of defence understands their role, responsibilities (supported by process) and whom they are accountable to. If they have clear objectives (that are aligned to the company strategy and values) and they understand how much tolerance for risk taking there is for each of those objectives, you are building truly effective reporting mechanisms.
Now all you have to do is provide staff with the tools they need to capture, evaluate, manage and escalate and you are on your way to some exciting, automatic data gathering! From the first line of defence in your organisation right to the top of the decision making chain. You will also have Decision Making Committees who are in touch with what is going on in their business and an opportunity to collaborate with the front line to Do Good Business Well!